In view of the tight housing market, it is becoming increasingly difficult for families to find affordable housing. With a new home ownership subsidy, Construction Minister Geywitz (SPD) now wants to support families with small and medium incomes.
Families with at least one minor child in the household and a maximum annual taxable household income of 60,000 EUR are eligible.
With a loan programme to promote home ownership, Federal Minister of Building Klara Geywitz (SPD) wants to support families with small and medium incomes. She mentioned that in view of the tight housing market and the price increases for building materials, they have a particularly hard time finding affordable housing. Now Business Insider has the details of the home ownership subsidy.
Who can apply for this new home ownership subsidy?
Families with at least one minor child in the household and a maximum annual taxable household income of 60,000 EUR are eligible. This means that about 75% of households in Germany would in principle be eligible to apply. For each additional minor child, the upper limit increases by 10,000EUR.
When families apply for home ownership support, they must not own any other residential property and must not have received any other federal support for home ownership in the past. Households in which a relative lives who has already received a subsidy for home ownership, for example Baukindergeld (which was discontinued), cannot receive a subsidy.
What requirements do new buildings have to meet in order to be subsidised?
The home ownership promotion scheme only supports new buildings in Germany that the owner occupies himself. However, it does not matter whether it is a single-family house, two-family house, terraced house or condominium. A new house does not necessarily have to be built. Even the addition of a storey to a building is sufficient for funding. The only important thing is that the new buildings have their own lockable entrance, at least one living room, a kitchen (or kitchenette) and their own bathroom.
Another requirement is that the new building must not only meet the statutory minimum standards of the Building Energy Act, but also the Efficiency House 55 funding standard that will apply from 1 January 2023. For energy-saving buildings, there is an efficiency house level as a benchmark that indicates how energy-efficient a building is. The rule is: the smaller the number, the lower the energy demand of the property. Only new construction that meets the standard “Climate-friendly building basic level” (KFG B) or the “sustainability class” (KFG NH) is to be promoted through the home ownership promotion scheme.
What are the conditions of the loan?
KfW Bank (Kreditanstalt für Wiederaufbau) grants the loan for home ownership up to a maximum of 35 years. Funding is scheduled to start in the second quarter of 2023. The maximum amount of the loan depends on the energy efficiency class in which a new building is classified.
The following maximum loan amounts apply to new buildings that are built according to the climate-friendly building basic level standards (new building KFG basic level):
- Families with up to two children: 140,000 euros.
- Families with three and four children: 165,000 euros.
- Families with five or more children: 190,000 euros.
The following maximum loan amounts apply to new buildings built according to sustainability class standards (new building KFG sustainability class):
- Families with up to two children: 190,000EUR.
- Families with three and four children: 215,000EUR.
- Families with five or more children: 240,000EUR.
In principle, it is possible to combine home ownership subsidies with state or regional subsidies for new construction. However, the sum of the combined subsidised interest and subsidies from other programmes may not exceed 60% of the costs for the new building. However, no combination is possible with the “Climate-friendly construction” (KfB) programme. In total, the ministry expects about 13,000 to 15,000 subsidised households per year. Around 350 million EUR in subsidies are earmarked for this.
The exact funding system is currently being worked out. However, we can already say that the life cycle consideration of the Quality Seal Sustainable Building (QNG) will play an important role in all funding levels. The exact details of the funding conditions will not be known until the funding guidelines have been finalised and can only be published then.
So.. we’ll need to wait for more details on the exact conditions.
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